Taxpayer is a New York company that does business in
Indiana. Pursuant to an audit, the Indiana Department of Revenue
("Department") assessed Taxpayer additional income tax, interest, as
well as underpayment penalty as a result of the audit. Taxpayer protested the
underpayment penalty.
…
The Department imposed an underpayment penalty because
Taxpayer failed to remit the required estimate of adjusted gross income tax
owed pursuant to IC § 6-3-4-4.1.
…
(d) The penalty prescribed by IC
6-8.1-10-2.1(b) shall be assessed by the department on corporations failing
to make payments as required in subsection (c) or (f). However, no penalty
shall be assessed as to any estimated payments of adjusted gross income tax which
equal or exceed:
(1) the annualized income installment calculated under
subsection (c); or
(2) twenty-five percent (25[percent]) of the final tax
liability for the taxpayer's previous taxable year.
In addition, the penalty as to any underpayment of tax on an
estimated return shall only be assessed on the difference between the actual
amount paid by the corporation on such estimated return and twenty-five percent
(25%) of the corporation's final adjusted gross income tax liability for such
taxable year.
Taxpayer has provided sufficient documentation demonstrating
that the imposition of the underpayment penalty is not appropriate.
